20150223-NEWS--0001-NAT-CCI-CN_-- 2/20/2015 6:44 PM Page 1 PIXIE-DUST ALERT Bruce Eichner’s back with a huge project. A sure sign of a market CRAIN’S® top? PAGE 3 NEW YORK BUSINESS VOL. XXXI, NO. 8 WWW.CRAINSNEWYORK.COM FEBRUARY 23-MARCH 1, 2015 PRICE: $3.00 CEO JAMES GORMAN has led a comeback that’s improved the NY’s best bank’s share price 55% in two years, the best on Wall Street. bank ain’t Goldman Left for dead during the crash, Morgan Stanley shows the rest of Wall Street how to get it done BY AARON ELSTEIN James Gorman bet that he could remake Morgan Stanley with a strategy that had been a miserable failure for the firm before. Five years after he became chief executive, it’s clear that the revamp is paying dividends. Mr. Gorman dramatically shifted Morgan Stanley’s course by emphasizing retail brokerage, which is the business of making money for individual investors. Wealth management, as the firm prefers to call it, now accounts for nearly half of its sales and earnings. That has put the company in a sweet spot as people flock back to the market after a long hibernation. Morgan Stanley’s stock has returned 55% in the past two years—more than any other See MORGAN STANLEY on Page 24 bloomberg news REPORT TECHNOLOGY Nicole Miller on Fashion Week Internet speed that’s 20 times faster than fatigue and manufacturing in NY anything you’ve ever experienced PAGE 11 loyal to her vision as a de- finding a home in New York—a place that BY ADRIANNE PASQUARELLI signer and as a New receives millions in direct spending as a Yorker—keeping the result of the event—been so tough? THE LIST ince founding her name- bulk of her production It’s only 10 days out of the year.First The most active venture-capital firms in the sake fashion label 33 years local, even when so we got thrown out of Bryant Park, ago, Nicole Miller has seen many competitors and then sent out of Lincoln Cen- New York area PAGE 13 her share of change—in- have outsourced to ter. Nobody knows where we’re istock cluding the rise of social China. going next. If you live nearby, Smedia, copycat styles and overseas there’s stuff going on all the time labor. Earlier this month at New Last week marked at Lincoln Center,but maybe the 08 the final Fashion 5 York Fashion Week, she proved residents could never get taxis, she’s still got it by featuring an inno- Week at Lincoln who knows? Hudson Yards is a vative collection of her signature Center, and the little frightening, that whole con- prints that meshed a mythical Into event has yet to cept of a mini-city. I like the idea the Woods vibe with unique imagery. announce a new of being downtown. Through it all, she has remained venue. Why has See NICOLE MILLER on Page 26 NEWSPAPER 71486 01068 0 20150223-NEWS--0002-NAT-CCI-CN_-- 2/20/2015 6:44 PM Page 1 EXECUTIVE EDITOR’S NOTE Don’t be shy FYICRAINSNEWYORK.COM When I was a reporter covering politics, my best sources were those who read Crain’s religiously: sharp- tongued, well-connected opinion- AmEx? You can istas immersed in the business and leave home without cultural life of the city.When I shifted to editing, I worried that I’d it, judge says lose contact with the people who Jeremy Smerd federal judge handed helped me understand how New down a David vs. York really works.Then two weeks Goliath ruling last week istockphoto ago, Crain’s Editor Glenn Coleman announced he’d A in a five-year-old case that elicited a cheer from small merchants. ¶ The judge said that be stepping into a new role as editor at large and that American Express Co.’s rules banning merchants from encouraging customers to use other credit I’d replace him. Up the masthead, out of the trenches, cards violate antitrust laws.The decision gives the 3.4 million restaurants and shops that accept out of touch? Reynold Levy, the former president of AmEx some much-needed leverage to cut costs. Merchants are now free to offer their own Lincoln Center, allayed my fears in the form of an perks, such as free shipping or lower prices, to consumers who use a lower-cost method of op-ed submission: a pointed criticism of the boards of payment. AmEx’s rules drive consumer fees higher and hurt competition, the judge said. AmEx the Metropolitan Council on Jewish Poverty and the plans to appeal the ruling. ¶ It’s another major setback for the credit-card giant, which has had Federation Employment and Guidance Service, two a rough year thus far. After announcing 4,000 job cuts in January, the Manhattan-based once-esteemed social-welfare organizations that company announced the end of multiyear partnerships with JetBlue Airways and Costco seemed to implode overnight. Mr. Levy was bold Wholesale Corp. earlier this month. ¶ The company is also facing encroaching competition from enough to ask the obvious: How did this happen and new tech-driven payment systems like Apple Pay, to which AmEx could lose out on lucrative who’s accountable? I immediately gave the piece the swipe fees from retailers. Such fees, about 2% of each transaction, amount to an estimated $40 green light (you can read it on Page 9) and emailed: billion a year for banks and card companies. ¶ AmEx’s share price hit a 52-week low of $77.12 “We should have written this story!”The op-ed was last week and has fallen 13% in the past 12 months. —adrianne pasquarelli an important reminder that you, dear reader, are our best resource, and we’re all smarter when you speak SILVER INDICTED. Former New York make hearings more open to the up.The problem—until now—is that the only way to state Assembly Speaker Sheldon Sil- public, and called for judges to pre- HOORAY! get your thoughts into Crain’s was an occasional 475- ver was indicted on federal corrup- side over hearings involving allega- A NEW DR. SEUSS BOOK, What Pet word hole in our newspaper’s op-ed page. We’re tion charges. He is accused of col- tions of homicide or felony assault Should I Get?, will be published by lecting nearly $4 million in bribes against police. … ILLEGAL CIGS. The Random House Children’s Books in July. changing that. Crain’s is—and will remain—a and kickbacks since 2002 and hiding state and city sued UPS for violating resource for New York business news and insight. But it as legitimate income. … GRIMM a 2005 agreement not to ship ciga- we’re also a trusted platform connecting New Yorkers SUCCESSOR. A special election has rettes to unauthorized recipients. been set for May 5 to replace Staten New York, which seeks to recover in the marketplace of ideas and action.That’s why in Island Rep. Michael Grimm, who more than $180 million in unpaid the coming months we’re going to launch online a resigned and pleaded guilty to tax cigarette taxes, claims that the ship- curated contributors’ network featuring in-the-know evasion. ... LAGUARDIA DELAYS. The ment company allowed 700,000 car- New Yorkers with expertise, ideas and opinions they $3.6 billion plan to overhaul La- tons to be sent to residents from Na- Guardia Airport’s main terminal tive American reservations. … OY VEY! simply cannot keep to themselves. We’re not the first building has been stalled again.This PROTECTING TENANTS. A joint state STATE GOP releases “50 Shades of Bill” media company to come up with this concept, but we time, the Port Authority of New and city task force was created to poster, portraying Mayor Bill de Blasio as the submissive character and the Rev. Al do think we’re best suited to steer the conversation in York and New Jersey wants to wait crack down on landlords suspected Sharpton as the dominant male. New York. If you’d like to apply to be a part of it, for the outcome of a of using renovation design competition ‘I do not and construction email [email protected]. C’mon, for all New York air- projects to force ten- you’re a New Yorker. We already know you’re not shy. ports before selecting believe … that ants out of rent- a developer to re- regulated apart- vamp the aging facil- the president ments. … GRISTEDES THIS WEEK IN CRAIN’S ity. … BANK CEO PAY loves America’ HQ SALE. Grocery CUTS. Citigroup and —Former New York Mayor mogul John Catsi- twitter@newyorkgop Bank of America Rudy Giuliani, during a matidis will sell SOURCE BREAKFAST -------------------- 1 Corp. have slashed private GOP dinner, Gristedes’ West Side with revitalizing the concert hall, is IN THE BOROUGHS---------------------------3 CEO salaries by 9% commenting on President corporate headquar- stepping down as chairman of and 7%, respectively. Barack Obama’s speech ters for $55 million Carnegie Hall’s board of trustees to SMALL BUSINESS ------------------------------4 Citi’s Michael Cor- about the fight against to developer Sumai- become board president. Financier THE INSIDER -----------------------------------------------5 bat and BofA’s Brian violent extremism da Khurana. The Ronald Perelman will replace him. TOP DOG. REAL ESTATE -----------------------------------------------6 Moynihan are each grocery chain will … Fifteen-inch Miss P be- expected to earn about $13 million likely relocate to Mr. Catsimatidis’ came the second beagle to win best in OPINION------------------------------------------------------------- 8 this year.Both banks had to pay hefty building at 1790 Broadway.